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Author Topic: MtGox charges an extra 2.5% for trading in different currencies  (Read 1025 times)
ronaldlee0917
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April 21, 2013, 09:25:55 AM
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Although they tell(or mislead?) you that they support trading in different currencies, doing so costs you extra money.
When you buy bitcoins from a seller using a different currency, they would hide the extra 2.5% fee into your order(you will see a price 2.5% higher than the actual price), in other words you are paying more money for the same amount of bitcoin than the others. This fee is in addition to the 0.6% transaction fee. Since the market is dominated by US dollars, and thus most sellers accept USD by default, it would be wise to only deposit US dollars into your account if converting to US dollars in prior costs you less than the aforementioned 2.5% fee.

Just a friendly reminder to anyone who are about to deposit money to MtGox and don't make the same mistake of me. Sad

The information is well-hidden here:
Quote
Q. Are there any other fees charged when trading in multi-currency?

A. No. However, please be advised that there is a 2.5% premium when a trade involves orders in different currencies.  However, this is not a separate charge. It is already reflected in the price you see.

source: https://support.mtgox.com/entries/20800336-Multi-Currency-Trading

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michaelexeter
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April 21, 2013, 12:01:08 PM
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can someone supply a little more info on this please?

I am waiting for my £1000 day trading pot to arrive at mtgox (i already have some long term bit coins). I assumed that after the receiving fee, all i would be charged is the 0.6%. Which if I do a quick buy and sell would cost me £12 total.

However if I'm also losing an extra £25 in each trade, this is a huge amount. (£62 for each quick buy/sale?)

naphto
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April 21, 2013, 12:20:08 PM
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This is obvious -_-
ronaldlee0917
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April 21, 2013, 03:53:28 PM
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can someone supply a little more info on this please?

I am waiting for my £1000 day trading pot to arrive at mtgox (i already have some long term bit coins). I assumed that after the receiving fee, all i would be charged is the 0.6%. Which if I do a quick buy and sell would cost me £12 total.

However if I'm also losing an extra £25 in each trade, this is a huge amount. (£62 for each quick buy/sale?)


For example, a seller from USA is willing to sell a bitcoin for 100USD, everyone using USD as their main currency could buy it for 100USD
However, if GBP is your main currency, you have to pay 102.5 USD and the price displayed to you is 102.5 * 0.6565 = 67.29 GBP.
You also need to pay the 0.6% commission as usual, you pay them in bitcoins when you are buying, so you will receive 0.994 bitcoins after the trade is done.
The same logic applies when later you want to sell the bitcoins in GBP, anyone from USA will view your price 2.5% higher than the price you requested, which means that you will be less likely to sell it.
With the premise that most of the trade is done in USD, you are at disadvantage when using any currency other than USD.

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ronaldlee0917
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April 21, 2013, 04:01:12 PM
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This is obvious -_-
Yes, but here is the newbie forum. I believe a handful of new-comers don't know about the extra fee, paying unnecessary expenses without even knowing about it.

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michaelexeter
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April 21, 2013, 06:11:25 PM
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thanks for that...

so now need to figure out a way to get my account funded with us dollars instead...
jweezy
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April 21, 2013, 06:15:32 PM
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they should charge only one fee.
it looks like my bank !!!
Malawi
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April 21, 2013, 06:58:30 PM
 #8

thanks for that...

so now need to figure out a way to get my account funded with us dollars instead...

Not sure here, but I assume you can get the £ in, then buy BTC and change your account to a $ account. Either that, or withdraw all your founds in BTC and make a new $-account that are founded with BTC

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April 21, 2013, 07:47:48 PM
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it seems impossible for them to do otherwise.  If you are a bitcoin seller with GBP on deposit, and someone with USD wants to buy your bitcoins, you will expect GBP in return.  This necessitates an exchange of USD for GBP.  That isn't free.  If Mtgox didn't do this, they could end up with a remarkable amount of fiat currency exposure in a very short amount of time.  The exchange rate adjustment gives them an opportunity to hedge it.
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